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How Much Do Female Business Owners Make?

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Does it pay to be in business for yourself -- especially if you're a woman?

Recent data suggest yes, it does. The Fall 2013 Small Business Monitor, a report from American Express OPEN, found that the average female entrepreneur's salary this year is $63,000, up from $60,000 a year. The report looks at a national sample of 1,038 U.S. small-business owners, male and female.

While it's difficult to compare studies, the per capita income of the average American is about $42,700 -- a figure that takes into consideration male and female workers of all ages, according to the Bureau of Economic Analysis. (The national figure doesn't separate entrepreneurs from employees, but the vast majority of America's work force -- about 144 million people -- is employed by someone else.) Other studies, including this international one by the Institute for the Study of Labor in Bonn, Germany, have suggested that the mean, median and standard deviation of incomes are higher for entrepreneurs than for employees.

That said, the AmEx study found that there are inequalities for women, even in entrepreneurship. While female business owners' salaries have risen in the past year to $63,000, the average male business owner earns $71,400 annually. Female business owners are also more likely to have to work a second job than their male counterparts (19 percent versus 11 percent of men).

The lower salary for the average woman entrepreneur is likely related to her company's overall revenue, rather than a decision to keep profits in the company or pay employees first. Women are two times as likely as men to run a company with annual revenue lower than $500,000, according to Alice Bredin, small business adviser to American Express OPEN. That's partly because more women run retail or online businesses, which have less earnings potential, she says.

"Women also typically secure financing in lower numbers, take fewer risks and make other decisions that result in smaller companies," Bredin says. "Smaller company, lower salary."

The lack of earnings parity with men has long been noted, and groups like Count Me In provide resources to help women grow their businesses. AmEx itself recently started a CEO BootCamp for Women, which includes live events, workshops and online resources to help women work on their business, as opposed to in it. The tools "help women make the shift from 'Jill of all trades' to CEO," says senior manager Alex Ytuarte.

In the corporate world, women often find it difficult to balance work and life; entrepreneurship offers more flexibility, but isn't a complete solution, according to the AmEx study. Female entrepreneurs say they are less satisfied with the amount of leisure time in their lives (63 percent vs. 70 percent of men) and are more likely to say they find it stressful balancing their personal life and their business (63 percent vs. 57 percent of men).

But the study found good news, when it comes to choosing self-employment over working for someone else. Some 81 percent of female entrepreneurs attribute their happiness in life entirely or somewhat to being an entrepreneur.

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